It is very easy, especially when embarking on a new business, to undersell your services. Whether it is rear of not getting the “win”, or lack of confidence in your ability or value in your product, it is very easy to pitch too low, to undersell yourself and ultimately to de-value your product or service.
Valuing a product, especially a non-tangible product such as web or graphic design, is a difficult task. If you are new to the business or just starting out on your own it can be a daunting one. You are sat there with no clients, trying, hoping, praying for your first contract. It is all too easy to take “doing whatever it takes” a little too far and lowering your price just to win the deal.
That’s not to say that you don’t need to compromise at all in the beginning. Many a company has fallen by the wayside by being over-confident in their ability, and more importantly in their potential to sell. When you don’t have the reputation behind you and the large client base of the large firms you need something different, something that separates you from the big boys, but in a good way. Just try not to make “price” the difference.
You will no doubt be well aware of the saying “you get what you pay for”. It is a well known and long established saying, and that didn’t happen by accident. As much as people don’t want to pay over the odds, they will also be wary of people charging too little. It is a balancing act, and one that needs careful consideration.
If you have a competitor who is charging less than you, try to work out why. Where do they save over the costs you have? Are they an economy of scale? Do they cut corners? Are they using sub-standard materials, or heaven-forbid are you charging too much? Be honest about all of this and have confidence in your product.
If there are reasons why they are charging less and you can identify them, then that is half the battle. While there are customers happy to save a few bucks, there are also customers who are focused on quality. In the long run customers will not thank a supplier for a lower price at the expense of quality. In time you will speak to potential customers and you WILL find many who have had bad experiences from people who in hindsight seemed “too cheap”.
The key to all of this is have confidence in your product, know your market, set a price you believe in and stick to it. Lack of belief in these things is often the reason people under-sell themselves.
People will pay for good products and good service, but before you can convince them you must convince yourself in the value of your product.